NEW DELHI: Banks Board Bureau Chief Vinod Rai has said there will be no witch hunt against bankers for loan defaults and that investigation agencies cannot take action without merit in cases.Rai’s assurance came after bankers expressed concern over the arrest of IDBI Bank officials in respect of loans given to Kingfisher Airlines . The Central Bureau of Investigation arrested Agarwal in connection with a Rs 950 crore loan given by IDBI Bank to the now-defunct Kingfisher Airlines. A senior finance ministry official told ET that investigation agencies are not on a witch hunt looking to open loan accounts and find issues.An assurance is warranted. To curb corruption, the incentive structure of senior PSU bankers must be tweaked by linking remuneration to profitability in the medium and long term. Stock options can form a large slice, but compensation can also be clawed back if any deficiency is found later.

Source: Economic Times January 25, 2017 18:23 UTC